Capping solar energy generation in Namibia misses the point

Is Namibia, a country uniquely positioned to benefit from solar energy, really putting the brakes on solar system deployment when other countries are forging ahead? If recent news is to be taken seriously, the answer is yes � progress towards a cleaner, more affordable supply of electricity in Namibia is indeed under threat.

Namibian electricity distributors, such as Erongo RED and the City of Windhoek, have started imposing caps on solar PV electricity production. They are refusing licence approvals for new solar systems installed by consumers, even if these are for self-consumption only.

This is a baffling move that is likely to negatively affect the Namibian economy, unless consumers and the government � particularly the Electricity Control Board (ECB) � take a firm stand and make it clear that such unilateral actions are unjustified and cannot be accepted.

Namibia's government recognises that it is one of the best countries in the world for solar PV power generation and has a progressive national renewable energy policy. It has supported the establishment of fourteen 5 MW solar plants, spread across the country, under the very successful REFIT Program.

Continued growth in harnessing its amazing solar resource makes Namibia part of a global trend. Solar installations worldwide have been growing year-on-year with around 30 percent to 40 percent over the past decade, with 98 GW of solar capacity installed globally in 2017.

The key reason for this growth is that solar PV has become the cheapest source of electricity. This presents a massive opportunity for Namibia especially: the country has some of the highest power tariffs in the SADC region and electricity costs are a significant burden for local businesses and domestic end-users. To illustrate this point, tariffs in some cases exceed N$2.00 per kWh as opposed to N$0.40 in Zambia and N$0.88 Botswana.

Allowing consumers to cover part of their energy consumption via solar PV systems, and therefore alleviating high electricity costs, will benefit the whole economy and lead to job creation in the solar sector and beyond.

So, why have distributors stopped approving new solar systems?

Some distributors may point to Namibia's grid and stability of supply. Concern over the stability of Namibia's grid is valid since its population is sparse and its grid-lines widely dispersed. The Electricity Control Board has conducted studies and NamPower to map out how much solar uptake can be allowed while keeping the grid stable.

However, it is evident that Namibia is not close to any tipping point where stable grid supplies are threatened by additional installations of intermittent renewables. Therefore, the much-cited issue of 'grid stability' cannot be considered a valid argument. In addition, the systems refused by the distributors include those for self-consumption only (no export), which have minimal impact on the grid.

At present, technical constraints are clearly not critical at all. The contribution of solar in Namibia's power mix is still only a few percent at best. In some countries such as Italy, Greece and Germany, solar production already accounts for more than 7 percent of total electricity consumption and it is increasing every year. Solar is not just suitable for large economies with extensive grid infrastructure: even in a small country as Honduras, solar already contributes more than 10 percent to the power generation mix.

Instead, the caps on solar have commercial reasons. The distributors are becoming less profitable, as consumers are helping themselves with more affordable solar electricity at an increasing scale. This situation is not unique to Namibia � it is happening across the world.

The way forward is not to impose unjustified caps and, in this way, kill the burgeoning solar industry in Namibia. Wishing away solar PV as a low-cost source of electricity is just a way of hiding one's head in the sand.

It is important for the ECB to take a strong stance against these artificial caps and the matter of own-use and net-metering solar installations throughout the country. Regulation should not be used to actively block more efficient or affordable power sources. Consumers should be allowed to install solar for own-use, just like they are allowed to install energy efficient LED lighting. The size and shape of a consumer's demand for electricity should be his or her own choice.

A more productive way forward would rather be to manage the transition towards the uptake of clean and decentralised electricity supply options, focusing on how battery storage can help firm up the variable (but cheap) supply of solar power, as well as making sure that distributors are fairly compensated for providing grid services to consumers. Embedded generation, such as own-use solar systems, can make the grid and power supply more resilient and at the same time enhance access to affordable energy.

Seen from a wider perspective, Namibia stands to gain tremendously if it were to fully use its solar resource. Namibia currently imports 57 percent of its power at high cost, yet it has the potential to become a regional net-exporter of electricity. In one future scenario, Namibia could link its solar output with the hydro resources in Zambia and Mozambique to provide power to the wider region. In this way, national competitive advantages such as Namibia's world-class solar energy resources could be used to mutual benefit. Similarly, Denmark exports excess wind power to Norway where it is stored in hydro reservoirs but sent back the other way when the wind does not blow.

An affordable and clean energy supply in Namibia needs more solar � not less. We should not accept distributor caps that hold back the future and force consumers to accept high electricity prices.